Which of the Following Statements Is True Regarding IRR

question 70

Multiple Choice

Which of the following statements is true regarding IRR?

• A) The cash flow generated by the product of the project for the first three years is considered.
• B) The company assumes that all of the annual cash flows will be positive.
• C) Cash flows are assumed to be constant from year to year and impervious to external factors.
• D) The inputs to the IRR calculation are the net cash flow for each year where at least one of them is negative and at least one of them is positive.
• E) The IRR method is considered inferior to the simple payback method.

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Definitions:

Power Consumption

This refers to the amount of electrical energy used by devices over time, typically measured in kilowatt-hours (kWh).

Test Statistic

is a calculated value from sample data used to determine whether to reject the null hypothesis in hypothesis testing.

Power Consumption

The amount of energy used by a device or system over a certain period.

Standard Deviation

An indicator of the extent of variability or spread among a collection of numbers, showing the degree to which these numbers differ from their average.